Chatoyancy is an optical effect with a specific physical cause, and chrysoberyl produces the finest example of it.
Inside the stone lie enormous numbers of very fine parallel tubes or needle inclusions, in chrysoberyl usually rutile. Each one scatters light in a band perpendicular to its own length. Because they are all aligned, the scattered bands coincide and the eye sees a single bright line. The stone must be cut as a cabochon with its base parallel to the plane of the needles, or the effect is lost, so a cat's eye is a cutting decision as much as a natural property.
Two consequences follow that identify a good stone. The eye should be sharp, straight, and centred, and it should open and close as the stone is rocked. And under a single light source held to one side, a fine chrysoberyl cat's eye shows the milk and honey effect: the half of the dome nearer the light appears honey-coloured and the far half milky white, with the eye dividing them. That is diagnostic and it is one of the more beautiful things a gemstone does.
The principal historical source is Sri Lanka, from the same alluvial gravels that supplied sapphire and spinel, and the stone reached both the Indian and the European trade from there.
Other minerals show the effect, including quartz, tourmaline and beryl, and the trade convention is that cat's eye without qualification means chrysoberyl. Anything else must be named: quartz cat's eye, tourmaline cat's eye. That convention is worth knowing when reading an old description.